UK 'living wage' raised to £7.85 per hour

The UK "living wage" - an hourly rate based on the amount needed to cover the basic costs of living - has been raised by 20p to £7.85.

The voluntary rate has been adopted by more than 1,000 employers across the country, benefiting 35,000 workers.

It is now 21% higher than the compulsory UK minimum wage, set at £6.50 by the government.

The rate in London will rise from £8.80 an hour to £9.15.

Firms who have signed up to the voluntary scheme include Barclays, Standard Life, the National Portrait Gallery, as well as many local councils and charities.

On Sunday, Citizens UK, the community organisation behind the Living Wage project, said the number of companies paying the rate had more than doubled in the past year.

Lack of 'opportunity'

Despite this rise, research published on Monday by accounting firm KPMG - a supporter of the wage - found 22% of the working population earn less than the 2013 Living Wage - which was set at £7.65 an hour.

It said more than five million people were paid below that rate, and that women were more likely to earn less than men.

"This research is further proof that more workers are getting stuck in low paid work with little opportunity for progression," said former Labour MP Alan Milburn, the chairman of the Social Mobility and Child Poverty Commission.

He added that "far more needs to be done" and that both employers and government should take responsibility